RES-8691 Approving Disposition and Development AgreementRESOLUTION NO. 8691
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
ORANGE APPROVING A DISPOSITION AND DEVELOPMENT
AGREEMENT BETWEEN THE ORANGE REDEVELOPMENT
AGENCY AND THE MILLS LIMITED PARTNERSHIP
PROVIDING, AMONG OTHER THINGS, FOR THE ACQUISITION
BY THE ORANGE REDEVELOPMENT AGENCY OF
APPROXIMATELY 74.5 ACRES OF REAL PROPERTY
COMMONLY.KNOWN AS THE CITY SHOPPING CENTER AND
THE DISPOSITION OF SAME TO THE MILLS LIMITED
PARTNERSHIP
WHEREAS, California Health and Safety Code Section 33433 requires that before the sale or
lease of any property acquired by a redevelopment agency, in whole or in part, directly or indirectly,
with tax increment moneys, pursuant to the redevelopment plan, said conveyance shall fIrst be approved
by the legislative body by resolution after a public hearing; and
WHEREAS, On September 10, 1996, the City Council of the City of Orange held a duly
noticed public hearing on the Orange Redevelopment Agency's (the "Agency") proposed purchase and
sale of certain real property (the "Property") described in that certain Disposition and Development
Agreement (the "DDA") between the Agency and The Mills Limited Partnership, a Delaware limited
partnership (the "Developer"), at which time all persons desiring to comment on or ask questions
concerning the DDA and the sale of the Property to the Developer were given the opportunity to do so.
The Property is commonly known as The City Shopping Center and is located on the west of The City
Drive, east of Lewis Street, and south of Chapman Avenue, and contains approximately 74.5 acres, in
the City of Orange, California. Prior to the public hearing, a summary report containing information
concerning the Agency's proposed purchase and sale of the Property to the Developer, as well as a copy
of the proposed DDA, was available for public inspection in the offIces of the City Clerk of the City
of Orange at 300 East Chapman Avenue, Orange, California 92866, between the hours of 8:00 a.m.
and 5:00 p.m., Monday through Thursday. Notice of the public hearing was published in the Orange
City News on August 22, 1996 and August 29, 1996; and
WHEREAS, The City Council has reviewed and considered all written and oral comments,
questions and concerns regarding the proposed purchase and sale of the Property pursuant to the DDA
that were received prior to and at the public hearing on the DDA; and
WHEREAS, The environmental impacts of the proposed development were analyzed in the
Mitigated Negative Declaration 1497-96 and evaluated by the Planning Commission and such
Mitigated Negative Declaration and the mitigation measures described therein were determined to be adequate
and complete;
and
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WHEREAS, The DDA requires the Developer to construct certain improvements on the
Property as therein described, including, among other things, a shopping center of approximately
811,909 square feet of gross leasable area; and
WHEREAS, The City Council and the Agency have obtained an analysis of the purchase price
of the Property from GRC Associates, Inc. ("GRC"), Such analysis provides that the total effective
land acquisition cost to be incurred by the Developer is approximately $35,424,876. Pursuant to the
DDA, the Agency will be purchasing the Property for $1,000,000 in cash and a promissory note in the
sum of $10,700,000, and then reconveying the Property to the Developer. Moreover, because the
promissory note is payable only from "Net Project Tax Increment" (as such term is defIned in the DDA)
actually received by the Agency, GRC estimates the present value of the promissory note to be only
8,000,000. This results in a net land cost to the Developer of $25,424,876, which corresponds to a
land value of $7.83 per square foot of gross area. In the opinion of GRC, $7.83 per square foot is
within the range of fair market purchase prices paid for large, regional retail designated properties in
the Los Angeles County, Orange County, western San Bernardino County and northern San Diego
County areas.
NOW, THEREFORE, BE IT RESOLVED, that the City Council of the City of Orange hereby
fInds, determines, resolves and orders:
THAT the City Council hereby fInds that the sale of the Property pursuant to the DDA will
assist in the elimination of blight due to the obligation of the Developer to construct thereon the
improvements described in the DDA.
BE IT FURTHER RESOLVED, that the City Council hereby fInds that the sale of the Property
pursuant to the DDA is consistent with the Orange Redevelopment Agency's Implementation Plan
approved and adopted by the Agency on November 22, 1994.
BE IT FURTHER RESOLVED, that the City Council hereby fmds that the consideration to
be paid by the Developer is not less than the fair market value of the Property at its highest and best
use in accordance with the Redevelopment Plan for the Agency's Southwest Project Area.
BE IT FURTHER RESOLVED, that the City CounCil hereby approves the DDA and the
disposition of the Property to the Developer in accordance with the terms and conditions of the DDA
pursuant to the requirements of Health and Safety Code Section 33433(b); provided, however, minor
modifIcations and corrections may be made thereto prior to its execution as approved by the City
Manager and the City Attorney.
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ADOPTED this 10th day of September, 1996.
Attest:
I hereby certify that the foregoing Resolution was duly and regularly adopted by the City
Council of the City of Orange at a regular meeting thereof held on the 10th day of September, 1996,
by the following vote:
AYES: COUNCIL MEMBERS: MURPHY, BARRERA, COONTZ, SPURGEON. SLATER
NOES: COUNCIL MEMBERS: NONE
ABSENT: COUNCIL MEMBERS: NONE
ABSTAIN: COUNCIL MEMBERS: NONE
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